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If a Firm Is Maximizing Its Profit and Producing Less

Question 8

Multiple Choice

If a firm is maximizing its profit and producing less than the output at which its average total cost is minimized,then that firm


A) must be suffering an economic loss.
B) must be earning an economic profit.
C) has excess capacity.
D) is producing at its capacity output.
E) must be earning a normal profit.

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